Termination and Settlement Agreements for Employers

Sometimes businesses need to part company with employees and manage their exit by way of settlement discussions.

Common reasons for termination include:

  • Persistent underperformance
  • Poor attitude or behaviour that does not fit the culture of the business
  • Restructuring of the business
  • Redundancy

Whilst formal termination processes do of course exist, we believe that it is preferable to achieve an amicable departure if possible and discuss an exit package as an alternative.  Ideally we encourage clients to avoid recourse to a Tribunal, as this will tend to reduce management distraction, time commitment and cost.

Our team of experienced, specialist employment lawyers can advise you on the risks of opening settlement discussions based on an understanding of the background and the likely response of the employee.

Our advice will be clear and concise so that you can make an informed decision as to how to maximise the commercial advantage to your business of reaching a settlement agreement. Well-managed settlement negotiations can serve to defuse the most difficult issues swiftly and effectively, reducing organisational risk, cost and loss of management time.

Where the employee’s exit is to be final, we can advise on issues such as commercial confidentiality, non-disclosure and non-compete clauses to be covered by the settlement agreement.  Where there is a desire to maintain an ongoing relationship by way of a consultancy arrangement for example, we can help you to build this into the settlement negotiations.

Our specialist team of employment lawyers have considerable experience in helping business clients with issues including:

  • Drafting disciplinary rules and procedures tailored for your business
  • The implementation and application of these procedures
  • Redundancy procedures
  • Performance management procedures and possible associated issues such as avoidance of claims for discrimination
  • Negotiating and preparing Settlement Agreements.

Case Studies

  • Defending a large pharmaceutical business against constructive dismissal allegations obtaining an out of court settlement which included undertakings relating to potential breach of restrictive covenants.
  • Achieving an amicable departure on the retirement of a garden centre CEO, enabling ongoing consultancy work combined with complex bonus arrangements.
  • Dismissal of four directors for gross misconduct and breach of statutory duties, resulting in a seven- figure claim against them.


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